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By John McCrank
NEW YORK, July 16 (Reuters) - Wall Street's self-fundedwatchdog fined a unit of Barclays PLC $800,000 forviolations related to how the bank reported stock trades over amore than two-year period, hampering the regulator's ability toproperly monitor the market.
The Financial Industry Regulatory Authority said lateWednesday that Barclays Capital did not properly update itselectronic systems to comply with regulations from August 2009that required that executing brokers report trades, as well asthe name of the executing parties of the trades, to FINRA.
As a result, between Aug. 3, 2009 and Dec. 11, 2012,Barclays failed to identify the correct executing party onaround 90 million reports with other broker dealers that weresent to FINRA's trade reporting facility.
"Reporting inaccurate data to FINRA impacts the integrity ofFINRA's audit trail and the ability of regulators to conductappropriate surveillance of member firm's trading activity," theregulator said.
Barclays consented to the fine without admitting or denyingthe allegations, and declined comment. The bank was fined$10,000 by FINRA in December 2010 for equity trade reportingviolations stemming from November 2008.
Like most big banks, Barclays operates it own in-houseelectronic trading venue, known as a "dark pool," where otherbrokers can send stock orders to be executed rather than sendingthem to a stock exchange where they might be charged higher feesand others may see the orders and bet against them.
New York's attorney general in June 2014 accused Barclays offraud over how it operated within its dark pool, saying itmisled investors to boost its own profits. Barclays has deniedany wrongdoing and said that no investors have been harmed.
Separately, FINRA settled a case with a unit of UBS Group AG last week that opens that bank up to new scrutiny ofits compliance supervision of its electronic trading platformover the next nine months.
The case stemmed from a follow-up examination from anotherFINRA case in which UBS paid $12 million in fines in 2011 andagreed to fix certain data reporting problems. In a follow-upexamination two years later, the regulator found ongoingviolations in which batches of trades entered electronically byUBS into a FINRA audit system were incomplete or inaccurate. (Reporting by John McCrank; Editing by Bill Rigby)
